Forest Gate Energy has acquired a working interest in a recompletion oil well located in Grand County, Utah.
Forest Gate will earn a 25% working interest in a suspended producing oil well by covering 100% of the recompletion cost. The 1,081-acre lease also includes production equipment such as a pump jack and storage tanks. Forest Gate will receive 50% of the oil and gas revenue until it recoups 100% of the recompletion cost estimated at $380,000.
The well was initially drilled to a depth of approximately 4600 feet and because of Federal lease stipulations, completion was not attempted until October 12, 2007. During the drilling operations mud loss and a poor cement job caused formation damage and minimized the evaluation of the lower Wingate. The well was then temporarily suspended.
Forest Gate is planning to evaluate 3 zones: the Upper Wingate, Kayenta and the Navajo Sandstone. If commercial production is established in any zone, completion efforts of other zones will be deferred.
"This recompletion project offers Forest Gate a low-risk oil well that we can recomplete in short order," said Don Vandergrift, Forest Gate's President and Chief Operating Officer. "This well intersected hydrocarbon-bearing formations and produced some oil from the lower Wingate Formation before it was damaged," added Mr. Vandergrift.
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